E-Business

Creating a Winning E-BusinessSecond Edition

Creating an E-Business Plan

Chapter 3

Creating a Winning E-Business Second Edition, Chapter 3

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Learning Objectives

Organize a business plan

Prepare an executive summary

Write a mission statement

Prepare a marketplace analysis

Create operational, financial, and management

plans


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Learning Objectives(continued)

Understand legal forms of businesses

Describe e-business partnerships


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Business Plan Organization

Business plan– Formal business planning document

• Identifies the business and its mission• Names the key management team members• Describes the products or services to be offered• Provides a marketplace analysis• Identifies customers and competitors• Determines resources for profitable operations• Sets a timetable for profitability


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Business Plan Organization(continued)

Government and for-profit sources for business planning information and templates– SCORE

– SBA

– BizPlanIt

– Bplans.com

– E-Future Centre


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Business plan components– Cover sheet and title page

– Table of contents

– Executive summary

– Business description

– Vision/mission statement


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Business plan components (continued)– Information on products/services

– Industry, customer, competitor analyses

– Operational, financial, and managerial plans

– Identification of critical risks

– Exit strategy


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Cover sheet– Title of document and preparer’s name

– Plan copy number

– “Confidential” notation Title page

– Cover sheet information and• Contact numbers• Key team members’ names• Name of person receiving the plan


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Table of contents– Lists all the major sections and subsections of the

plan

– Prepared after rest of plan is complete

– Carefully checked for omissions and page number errors


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Executive summary– A condensed version of the complete plan

– Used by interested parties to quickly assess the business idea and weed out plans

– Keep it short (one to three pages)

– Use clear and concise language and action words

– Create last after plan details are developed


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Vision statement– A formal statement of a business’s hopes and

desires

– Written to guide and inspire employees Mission statement

– A formal statement that explains a business’s reason for existing


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Business description– Summary of business’s background

– Information about legal form of business

– Business’s history to date

– Key personnel

– Future goals


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Products or services section– Description of products or services offered

– Anticipated sales for each product or service

– Describes benefits of product or service to customers


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Marketplace analysis– Information about the specific industry of which

business is a part

– Description of targeted customers

– Description of major competitors

– Overview of marketing and sales strategies


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Operational plan– Describes a business’s physical location and

equipment

– Notes the manufacturing or service actions needed to get products/services to market

– Summarizes Web site operations


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Financial plan– Explains how your e-business idea, goals, and

strategies translate into profits

– Provides standard financial statements for income, expense, and cash flow data

• Pro forma balance sheet• Projected income statement• Planned cash flow statement

– May include “deal plan,” break-even analysis, ratio analysis


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Management plan– Organizational structure of business

– Information on• Key members of management team• Outside advisors• Mentors• Consultants


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Appendices– Resumes

– Pictures of products

– Explanation of services

– Legal documents

– Other supporting documentation


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Legal Forms of Organization

Sole proprietorship– Business started by an individual

– Owner and business are one in the same for tax and legal liability issues


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Legal Forms of Organization (continued)

Partnership– Legal business entity with two or more co-owners

– Follows a partnership agreement

– General partnership: Tax and legal liabilities flow through to individual partners

– Limited partnership• General partner manages and assumes unlimited

liability• Limited partners have liability for amount of their

capital contribution and their accepted debt


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Corporation– Separate legal and taxable entity from its owners

– “C” corporation owners are it shareholders

– Liability is limited to investment in business

– Profits are taxed twice: once for the corporation and again when distributed to owners as stock dividends


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Corporation (continued)– “S” corporation gives owners partnership status

and corporate liability protection Limited liability company (LLC)

– Tax status of sole proprietorship or partnership

– Liability status of a corporation


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E-Business Partnerships

Strong positive relationships with strategic partners are critical– Partnerships that help build market awareness

• Public relations firms• Marketing consultants

– Partnerships that assist in operations• Suppliers• Distributors• Web hosting companies


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Chapter Summary

A business plan is used to– Check feasibility of business

– Seek funding

– Guide operations A business plan includes

– Cover sheet and title page

– Table of contents and executive summary

– Marketplace analyses

– Operational, financial, and marketing plans


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Chapter Summary(continued)

Business plan appendices can include– Resumes

– Pictures of products and information on services

– Legal documents

– Other supporting details for the overall plan


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Chapter Summary(continued)

Business description should include legal form of business

Business plan should note key strategic partnerships

E-Business

Education

Transcript of E-Business